Wading into the murky matters of money

But money — the earning, spending, saving, investing of it — is the root of plenty of worry, stress, argument, dreams and sleepless nights. Some people even dread just talking about finances. They’d rather spend an hour talking to a dentist’s drill than to a financial adviser.

All this over something we all need and want, but which in itself has no value. A dollar bill is nothing but a piece of special paper with an odd collection of pictures and symbols printed in a special kind of ink. You can’t eat it, wear it, use it for heat or light. There’s a Native American proverb: “Only when the last tree has died and the last river been poisoned and the last fish been caught will we realize we cannot eat money.”

Money gets its value only from what it can be exchanged for. That’s where inflation comes in. But that’s a topic for another day.

This column will not deal with the earning or spending of money. Investing your savings is our beat. Not stock trading or speculating. Trying to time the market is a fool’s game. There are plenty of heavily-touted trading systems out there. They come and go. Their underlying truth is: All systems work sometimes; no system works all the time. Forget it.

Nor will we offer specific recommendations of individual stocks or bonds. A financial adviser who puts your interests first can do so only after talking to you, learning your individual needs and goals and circumstances, your level of risk tolerance. How would you react if your investments went down in value? Would you panic and want out, or see it as an opportunity and buy more?

The world of investing is filled with as many mysterious off-putting acronyms as the armed forces: ETF, REIT, P/E. P/S. P/B. YTM, laddered CDs, DJIA.Confusing, right?Scary? Intimidating? Too much for you?

In a way, it’s meant to be. Wall Street wants you to feel lost, helpless, in need of their smarts and advice and management — for a fee, maybe a percentage of your money, usually a continuing fee. We will decipher the financial world’s argot for you.

Are money managers smarter than you? More knowledgeable, maybe, but that’s not the same as smarter. Besides, the successful management of money is really quite simple — suspiciously, deceptively simple. It depends less on intelligence or even knowledge and more on your emotions — primarily discipline, fear and greed.

I once had a client who was a successful physician. The market had been going down sharply for a few days. He said to me, “Should I panic?” I couldn’t tell him if he should panic. He already had.

Overcoming those emotions that work against you will be your biggest challenge for successful saving and investment for the long term.